Directors & Officers

Defend allegations of wrongdoing

The directors and officers of a business not only have a great deal of responsibility, but are usually its most visible members. If an aggrieved customer, shareholder, regulator or employee brings legal action directly against a key management figure personally, their private finances would be in jeopardy.

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Covering the costs of investigating and defending allegations, a Directors & Officers Insurance policy can protect against allegations of:

Breach of trust

Breach of duty

Corporate negligence

Error or omissions

Misleading information and statements

Wrongful trading

Damages and legal costs

Full Details

Intro

Even in a company with limited status, personal liability is unlimited. Any allegations of wrongdoing need to be investigated and defended. This can cost a significant amount even if the case doesn’t reach court, risking directors’ and officers’ personal finances.

What is a wrongful act?

This could be a breach of trust, breach of duty, neglect, error, misleading statement, or wrongful trading, committed or attempted by a director or officer whilst acting in this capacity on behalf of the company.

Where can a claim come from?

Employees – Thousands of employee claims are brought against senior management every year, from unfair dismissal to harassment and discrimination

Regulators – Companies can face investigation from industry bodies such as the Health & Safety Executive and Department of Trade & Industry, which can take action against individuals

Shareholders – Following some high profile claims, shareholders now closely scrutinise the activities of directors and there are more requirements for transparency of directors’ decisions

European Legislation – it can be difficult to keep up with the latest directives, but directors must ensure their company does not breach legislation

Creditors – Creditors are now more frequently claiming against individuals in cases of insolvency